Here's how two casino developers benefited from the Gaming Commission's tough review

They came rushing in at the last minute, like college kids racing across campus to get their final reports in on time. But these weren’t just reports — they were mini-libraries. The two Boston-area casino applications that arrived at the Massachusetts Gaming Commission right before the Dec. 31 deadline each totaled more than 15,000 pages.

Sheer size alone could account for why Wynn Resorts and the Mohegan Sun/Suffolk Downs partnership were cutting it so close. But there was at least one another factor: the MGC’s demanding background check process. This “suitability review” was so intense, it prompted Wynn Resorts chief Steve Wynn to badmouth the MGC to investors in October, and it prompted Suffolk’s original gaming partner, Caesars Entertainment, to completely leave from the state.

But there’s a twist that seems to have gone unnoticed: Despite the headaches, Wynn and the two main Suffolk Downs shareholders are in much better financial positions because of the MGC’s rigorous demands.

Wynn is the simpler one to explain. Wynn and his company must have been getting grilled for him to complain so publicly back in October. But in the end, Wynn could be laughing all the way to the bank. One of the key sticking points in Wynn’s application revolved around the ownership of the roughly 30-acre parcel in Everett where Wynn wants to build. Gaming regulators wanted to make sure that two businessmen with criminal records weren’t going to make a secret profit from the deal. So the partnership that owns the land, known as FBT Everett Realty, agreed to cut its price for the land in half, from $70 million to $35 million. The MGC’s inspectors were apparently satisfied, and Wynn passed the background check last month. But I’m not so sure Wynn will be badmouthing the gaming commission again after its review process just saved him $35 million. Those savings should come in handy if Wynn wins the casino license, as the property has serious contamination issues that need to be addressed.

Then there’s Sterling Suffolk Racecourse, the partnership that owns Suffolk Downs, on the Boston-Revere line. Things weren’t looking good for Suffolk back in October, when Caesars suddenly bowed out because of the MGC staff’s criticisms. Going into the Nov. 5 referendum without a partner inevitably hurt Suffolk’s chances to get approvals in East Boston and Revere. East Boston voters ended up rejecting the plan, while Revere voters supported it. Suffolk and Revere Mayor Dan Rizzo then scrambled to rearrange the casino plan so it would be built on the Revere side of the 163-acre property, the side where Suffolk’s horse barns are located. Then Mohegan Sun and its backer Brigade Capital Management, fresh off their narrow defeat in Palmer, agreed to join up with Suffolk.

But the location of the casino resort isn’t the only big difference between the old Caesars plan and the new Mohegan plan. Under the prior proposal, Caesars was just contributing 4 percent of the equity. Joe O’Donnell and Richard Fields, Suffolk’s two primary shareholders, would be responsible for the bulk of the investment. But under the new plan, Fields and O’Donnell just become landlords, and Mohegan Sun and Brigade will be the developers and owners of the casino operation. Mohegan would lease the property it needs on the Revere side from Suffolk. The risks in building a $1 billion-plus project would now be squarely on Mohegan and Brigade. Fields has sunk millions into the track in recent years to keep horse racing alive, but the gaming commission’s staff raised concerns about how little capital he now has. As a landlord, Fields would be able to reap the benefits from the casino through steady lease payments, without having to help foot the bill to build the thing.

Of course, this new plan does create headaches for O’Donnell and Fields. They need to go back to Revere voters in February to get their approval for the redesigned casino. And they need to build new horse barns, something that they estimate would cost at least $30 million. It’s something they would like to do on the East Boston side of the track, for obvious reasons, but it means they’ll need permits from the city of Boston, and thus the support of the Walsh administration. They believe they could also serve the track by building off-site barns, but that alternative is less than ideal for a number of reasons.

Not everyone emerged from the background check process with more money in their pockets. Caesars has sued the gaming commission over its forced departure, claiming in its suit that MGC chairman Steve Crosby directed his staff to be hard of Caesars because on a longtime friendship with one of the owners of the rival property in Everett. Caesars says it had invested more than $100 million in this state’s casino competition before the company withdrew.

If Revere voters approve this new Suffolk plan, the gaming commission will get to pick one of the two applicants, Suffolk or Wynn. The winner will walk away in a stronger financial situation, thanks to events prompted by the commission’s suitability reviews. The loser will still suffer a serious financial blow. But this is a casino we’re talking about. You don’t play if you don’t like to gamble.